Yangarra Resources Ltd T.YGR

Alternate Symbol(s): YGRAF

Energy Oil & Gas E&P

Yangarra Resources Ltd. is a Canadian junior oil and gas company engaged in the exploration, development and production of clean natural gas and conventional oil. The Company has its main focus in the Western Canadian Sedimentary Basin. The Company has an interest in approximately 184.5 sections (118,080 acres) in this field, which is located around the town of Rocky Mountain House, Alberta. The company has developed its land base to target the halo Cardium at Ferrier, Chedderville, Cow Lake, Chambers, O’Chiese, and Willesden Green with a focus on exploiting the prolific bioturbated zone as part of the entire Cardium package.

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Yangarra Resources Ltd

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Post by sculpin2on Jun 06, 2020 1:16pm

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Post# 31120224

A Brief Set of Natural Gas Macro Comments

A Brief Set of Natural Gas Macro Comments. This is a very brief set of comments on the current natural gas macro in the U.S.

Storage is elevated but not at record levels. This is well known.
Elevated storage has driven natural gas prices well into the future to multi-year lows.
This, in turn, has driven drilling and completion operations to multi-year lows.
Meanwhile, dry gas production peaked in November 2019 and has been contracting since. This decline in production has accelerated in recent weeks due to a combination of the lower activity and curtailed oil volumes which bring them significant associated natural gas volumes.
Present pricing is not high enough to prompt most large gas players to attempt to grow production and we've seen a couple of rounds of capital program reductions after what was a lower 2019 vs 2018. Drill to fill firm transport and drill to hold acreage have largely taken a back seat to fear of being further punished for outspending cash flow.
On the demand side, COVID-19 has worked to reduce LNG demand and we have seen a sizable contraction in exported volumes. LNG was very recently setting new highs and has been cut almost in half in the last week from that peak level.
We are not however seeing significant COVID-19 related hits to Industrial demand or Commercial demand. This time of year, Commercial contracts naturally anyway with reduced need for space heating. The lack of real hit to Industrial is interesting given the reduction in refinery throughput.
In the electricity arena, we are seeing strong gas-fired generation demand and we expect a record year for gas-fired demand due to the cheapness of gas, coal-fired generator closures, and an inability of other baseload sources, like nuclear, to generate more than they already do. Quite simply, natural gas continues to take generation share. We expect the arrival of summer heat to quickly prompt new weekly record levels.
Our view is that natural gas prices will improve as the year progresses, despite the LNG speedbump, as traders' focus shifts from a primary storage-based concern to the greatly improved directionality of supply and demand.